World Economic Forum: “Dire Situations Call for Bold Measures.”

The World Economic Forum on East Asia wrapped up this week with Ahn Ho-Young, South Korea’s Deput  Minister for Trade, saying it was dominated by “the three F’s”: food, fuel and finance.

A forum survey of the 55 business leaders who attended the two-day meeting in Kuala Lumpur, Malaysia, showed that an overwhelming 81% voted for “addressing growing global concern over environmental challenges such as climate change and water” as the top issue facing Asia.

Also of concern were “preventing political and economic instability linked to rising food and energy prices” and “managing the social, environmental and infrastructural implications of rapid urbanization.”
The survey also revealed that the price of rice had more than tripled in Thailand since January. During the same time, diesel prices have risen over 26% in Vietnam.
Water is another issue rising to the fore, with Peter Brabeck-Letmathe, Chairman of the Board, Nestle, Switzerland, repeating his dire warning: “We will be running out of water long before we run out of oil.”

He lamented that more of the world’s GDP was not being allocated to water: “One out of every five children is dying every 20 seconds because we haven’t been able to solve the problem of clean water today.”

Mr. Ho-Young (South Korea)  urged Asia to do three things: “First, it is important for Asian countries to maintain their open market policies which will enable us to maintain the momentum of economic growth,” he said. Second, he urged Asian countries to pay more attention to the economic and social impacts imposed by the global economic uncertainties. Third, “Asian countries should and must play a more active role in solving global issues,” he said (Xinhua).
In his opening remarks, Malaysian Prime Minister Abdullah bin Ahmad Badawi referred to fundamental questions, primary assumptions, and revered assumptions, that had to be reviewed and re-evaluated. “Unless we are prepared to address these questions sincerely and take necessary remedial measures,” he said, “our economies and the livelihood of hundreds of millions of people will continue to be vulnerable. Dire situations call for bold measures” (The Toronto Star).

East Asia (generally consisting of Japan, North and South Korea, China, Taiwan, with Vietnam and Singapore) has come to the realization that it is now in a position to react positively, with the best interests of the region in mind, to the world’s economic challenges.

Uri Avnery
14.06.08
An Apology

THIS WEEK, the Prime Minister of Canada made a dramatic statement in Parliament: he apologized to the indigenous peoples of his country for the injustices done to them for generations by successive Canadian governments.

This way, White Canada tries to make peace with the native nations, whose country their forefathers conquered and whose culture their rulers have tried to wipe out.

Apologizing for past wrongs has become a part of modern political culture.

That is never an easy thing to do. Cynics might say: nothing to it. Just words. And words, after all, are a cheap commodity. But in fact, such acts have a profound significance. A human being - and even more so, a whole nation - always finds it hard to admit to iniquities performed and to atrocities committed. It means a rewriting of the historical narrative that forms the basis of their national cohesion. It necessitates a drastic change in the schoolbooks and in the national outlook. In general, governments are averse to this, because of the nationalistic demagogues and hate-mongers who infest every country.

The President of France has apologized on behalf of his people for the misdeeds of the Vichy regime, which turned Jews over to the Nazi exterminators.

The Czech government has apologized to the Germans for the mass expulsion of the German population at the end of World War II.

Germany, of course, has apologized to the Jews for the unspeakable crimes of the Holocaust.

Quite recently, the government of Australia has apologized to the Aborigines.

And even in Israel, a feeble effort was made to heal a grievous domestic wound, when Ehud Barak apologized to the Oriental Jews for the discrimination they have suffered for many years.

But we face a much more difficult and complex problem. It concerns the roots of our national existence in this country.

I BELIEVE that peace between us and the Palestinian people - a real peace, based on real conciliation- starts with an apology.

In my mind’s eye I see the President of the State or the Prime Minister addressing a special extraordinary session of the Knesset and making a historic speech on the following lines:

MADAM SPEAKER, Honorable Knesset,

On behalf of the State of Israel and all its citizens, I address today the sons and daughters of the Palestinian people, wherever they are.

We recognize the fact that we have committed against you a historic injustice, and we humbly ask your forgiveness.

When the Zionist movement decided to establish a national home in this country, which we call Eretz Yisrael and you call Filastin, it had no intention of building our state on the ruins of another people. Indeed, almost no one in the Zionist movement had ever been in the country before the first Zionist Congress in 1897, or even had any idea about the actual situation here.

The burning desire of the founding fathers of this movement was to save the Jews of Europe, where the dark clouds of hatred for the Jews were gathering. In Eastern Europe, pogroms were raging, and all over Europe there were signs of the process that would eventually lead to the terrible Holocaust, in which six million Jews perished.

This basic aim attached itself to the profound devotion of the Jews, throughout the generations, to the country in which the Bible, the defining text of our people, was written, and to the city of Jerusalem, towards which the Jews have turned for thousands of years in their prayers.

The Zionist founders who came to this country were pioneers who carried in their hearts the most lofty ideals. They believed in national liberation, freedom, justice and equality. We are proud of them. They certainly did not dream of committing an injustice of historic dimensions.


ALL THIS does not justify what happened afterwards. The creation of the Jewish national home in this country has involved a profound injustice to you, the people who lived here for generations.

We cannot ignore anymore the fact that in the war of 1948 - which is the War of Independence for us, and the Naqba for you - some 750 thousand Palestinians were compelled to leave their homes and lands. As for the precise circumstances of this tragedy I propose the establishment of a “Committee for Truth and Reconciliation” composed of experts from your and from our side, whose conclusions will from then on be incorporated in the schoolbooks, yours and ours.

We cannot ignore anymore the fact that for 60 years of conflict and war, you have been prevented from realizing your natural right to independence in your own free national state, a right confirmed by the United Nations General Assembly resolution of November 29, 1947, which also formed the legal basis for the establishment of the State of Israel.

For all this, we owe you an apology, and I express it hereby with all my heart.

The Bible tells us: “Who so confesseth (his crimes) and forsakes them shall have mercy” (Proverbs 28:13). Clearly, confession does not suffice. We have also to forsake the wrongs we have done in the past.

It is impossible to turn the wheel of history back and restore the situation that existed in the country in 1947, much as Canada - or the United States, for that matter – cannot go back 200 years. We must build our common future on the joint desire to move forwards, to heal what can be healed and repair what can be repaired without inflicting new wounds, committing new injustices and causing more human tragedies.

I urge you to accept our apology in the spirit in which it is offered. Let us work together for a just, viable and practical solution of our century-old conflict - a solution that may not fulfill all justified aspirations nor right all wrongs, but which will allow both our peoples to live their lives in freedom, peace and prosperity.

This solution is clear for all to see. We all know what it is. It has emerged from our painful experiences, hammered out by the lessons of our sufferings, crystallized by the exertions of the best of our minds - yours as well as ours.

This solution means, simply: You have the same rights as we. We have the same rights as you: to live in a state of our own, under our own flag, governed by laws of our own making, ruled by a government freely elected by ourselves - hopefully a good one.

One of the fundamental commandments of our religion - as of yours and every other – was pronounced 2000 years ago by Rabbi Hillel: Do not unto others, what you do not want others to do to you.

This means in practice: your right to establish at once the free and sovereign State of Palestine in all the territories occupied byIsrael in 1967, which will be accepted as a full member of the United Nations.

The borders of June 4,1967, will be restored. I hope that we can agree, in free negotiations, to minimal exchanges of territory beneficial to both sides.

Jerusalem, which is so dear to all of us, must be the capital of both our states - West Jerusalem, including the Western Wall, the capital of Israel, East Jerusalem, including al-Haramal-Sharif, which we call the Temple Mount, the capital of Palestine. What is Arab shall be yours, what is Jewish shall be ours. Let us work together to keep the city, as a living reality, open and united.

We shall evacuate the Israeli settlements, which have caused so much suffering and iniquities to you, and bring the settlers home, except from those small areas which will be joined to Israel in the framework of freely agreed swaps of territory. We shall also dismantle all the paraphernalia of the occupation, both physical and institutional.

We must approach with open hearts, compassion and common sense, the task of finding a just and viable solution for the terrible tragedy of the refugees and their descendants. Each refugee family must be granted a free choice between the various solutions: repatriation and resettlement in the State of Palestine, with generous assistance; staying where they are or emigration to any country of their choice, also with generous assistance; and yes - coming back to the territory of Israel in acceptable numbers, agreed by us. The refugees themselves must be a full partner in all our efforts.

I trust that our two states - Israel and Palestine, living side by side in this beloved but small country, will quickly come together on the human, social, economic, technological and cultural levels, creating a relationship that will not only guarantee our security, but also rapid development and prosperity for all.

Together we will work for peace and prosperity throughout our region, based on close relations with all the countries of the area.

Committed to peace and vowing to create a better future for our children and grandchildren, let us rise to our feet and bow our heads in memory of the countless victims of our conflict, Jews and Arabs, Israelis and Palestinians - a conflict that has lasted far too long.

SUCH A SPEECH is, to my mind, absolutely essential for opening a new chapter in the history of this country.

In decades of meeting with Palestinians of all walks of life, I have come to the conclusion that the emotional aspects of the conflict are no less - and perhaps even more -important than the political ones. A profound sense of injustice permeates the minds and actions of all Palestinians. Unconscious or half-conscious guilt feelings are troubling the souls of the Israelis, creating a deep conviction that Arabs will never make peace with us.

I do not know when such a speech will be possible. Many imponderable factors will have an impact on that. But I do know that without it, mere peace agreements, reached between haggling diplomats, will not suffice. As the Oslo agreements have shown, building an artificial island in a sea of stormy emotions just will not do.

THE PUBLIC apology by the Canadian Prime Minister is not the only thing we can learn from that North American country.

43 years ago, the Canadian government took an extraordinary step in order to make peace between the English-speaking majority and the French-speaking minority among their citizens. That relationship had remained an open wound from the time the British conquered French Canada some 250 years ago. It was decided to replace the Canadian national flag, which was based on the British “Union Jack”, with a completely new national flag, featuring the maple leaf.

On this occasion, the Speaker of the Senate said: “The flag is the symbol of the nation’s unity, for it, beyond any doubt, represents all the citizens of Canada without distinction of race, language, belief or opinion.”

We can learn something from that, too.

——————-

We will only note in addition that while some Arabs will continue to be equal citizens in the State of Israel, it is imperative that some Jews are guaranteed equality as citizens of the future Palestinian State.

As Arab villages and cities are part of the Israeli landscape, so some Jewish settlements and cities must be allowed on the territory of Palestine also. This is the reciprocity that without there cannot be a conciliation - and a hint to such a future of amicable coexistance of the two States must be part of this apology - if we want to see in it the base for settling not only the past but also the future.

Let us face realities - today in the Middle East, as everywhere else, the future is set before the past.

Opinion, The New York Times, Friday June 13, 2008: Bad Cow Disease.

by: Paul Krugman, The New York Times

“Mary had a little lamb / And when she saw it sicken / She shipped it off to Packingtown / And now it’s labeled chicken.”
That little ditty famously summarized the message of “The Jungle,” Upton Sinclair’s 1906 exposé of conditions in America’s meat-packing industry. Sinclair’s muckraking helped Theodore Roosevelt pass the Pure Food and Drug Act and the Meat Inspection Act - and for most of the next century, Americans trusted government inspectors to keep their food safe.
Lately, however, there always seems to be at least one food-safety crisis in the headlines - tainted spinach, poisonous peanut butter and, currently, the attack of the killer tomatoes. The declining credibility of U.S. food regulation has even led to a foreign-policy crisis: there have been mass demonstrations in South Korea protesting the pro-American prime minister’s decision to allow imports of U.S. beef, banned after mad cow disease was detected in 2003. How did America find itself back in The Jungle?

It started with ideology. Hard-core American conservatives have long idealized the Gilded Age, regarding everything that followed - not just the New Deal, but even the Progressive Era - as a great diversion from the true path of capitalism.
Thus, when Grover Norquist, the anti-tax advocate, was asked about his ultimate goal, he replied that he wanted a restoration of the way America was “up until Teddy Roosevelt, when the socialists took over. The income tax, the death tax, regulation, all that.”
The late Milton Friedman agreed, calling for the abolition of the Food and Drug Administration. It was unnecessary, he argued: private companies would avoid taking risks with public health to safeguard their reputations and to avoid damaging class-action lawsuits. (Friedman, unlike almost every other conservative I can think of, viewed lawyers as the guardians of free-market capitalism.)

Such hard-core opponents of regulation were once part of the political fringe, but with the rise of modern movement conservatism they moved into the corridors of power. They never had enough votes to abolish the F.D.A. or eliminate meat inspections, but they could and did set about making the agencies charged with ensuring food safety ineffective.
They did this in part by simply denying these agencies enough resources to do the job. For example, the work of the F.D.A. has become vastly more complex over time thanks to the combination of scientific advances and globalization. Yet the agency has a substantially smaller work force now than it did in 1994, the year Republicans took over Congress.
Perhaps even more important, however, was the systematic appointment of foxes to guard henhouses.
Thus, when mad cow disease was detected in the U.S. in 2003, the Department of Agriculture was headed by Ann M. Veneman, a former food-industry lobbyist. And the department’s response to the crisis - which amounted to consistently downplaying the threat and rejecting calls for more extensive testing - seemed driven by the industry’s agenda.
One amazing decision came in 2004, when a Kansas producer asked for permission to test its own cows, so that it could resume exports to Japan. You might have expected the Bush administration to applaud this example of self-regulation. But permission was denied, because other beef producers feared consumer demands that they follow suit.
When push comes to shove, it seems, the imperatives of crony capitalism trump professed faith in free markets.
Eventually, the department did expand its testing, and at this point most countries that initially banned U.S. beef have allowed it back into their markets. But the South Koreans still don’t trust us. And while some of that distrust may be irrational - the beef issue has become entangled with questions of Korean national pride, which has been insulted by clumsy American diplomacy - it’s hard to blame them.
The ironic thing is that the Agriculture Department’s deference to the beef industry actually ended up backfiring: because potential foreign buyers didn’t trust our safety measures, beef producers spent years excluded from their most important overseas markets.
But then, the same thing can be said of other cases in which the administration stood in the way of effective regulation. Most notably, the administration’s refusal to countenance any restraints on predatory lending helped prepare the ground for the subprime crisis, which has cost the financial industry far more than it ever made on overpriced loans.
The moral of this story is that failure to regulate effectively isn’t just bad for consumers, it’s bad for business.
And in the case of food, what we need to do now - for the sake of both our health and our export markets - is to go back to the way it was after Teddy Roosevelt, when the Socialists took over. It’s time to get back to the business of ensuring that American food is safe.

————-

KUDOS to Paul Krugman! We say so because we wrote about all of this many times and even have on our site a button called “POLICY LESSONS FROM MAD COW DISEASE” that is right in the center of our collection of main buttons.

The MCD button is because we thought one could learn from how Ann Veneman destroyed her Cattleman Clients by hiding information, that when it eventually burst into the open, destroyed the business she was covering for. She was banished from Washington and exiled to the UN as head of UNICEF. It did not matter that she was not exactly fit for that job since her background was in lobbying Washington, not really in matters of the family or international children misery beyond the effort to market American cheese to the needy - and as it turned out, thanks to Inner City Press, to do favors to flashy Gucci on UN property. The changing Korea? Did she say something to Mr. Ban Ki-moon that he passed to the new Korean Government that was a welcome change so far as the US was concerned? Could we perhaps try North Korea instead? Who knows, they may find US steaks more to their taste then the nukes? After all armies need full bellies and the Cattleman needs a place to download the beef.

————

On the other hand, let us see what can be done in the Korea case and let us understand the “behind-the-scene.”
Seoul’s Beef Beef: The Bush administration and Congress must rescue free trade with South Korea.

Saturday, June 14, 2008; Page A14, The Washington Post.
There is no reason for South Koreans to fear beef from the United States. Seoul banned it five years ago after U.S. officials confirmed a case of mad-cow disease in an American herd. But the health risk, never great, has long since faded; Americans have been consuming meat with no mad-cow-related problems, and the World Organization for Animal Health declared U.S. beef fit for consumption last September. This fulfilled Seoul’s final condition for lifting the ban, and, in April, newly elected President Lee Myung-bak announced that it would indeed end.

So why are South Koreans nearly rioting in protest, and why has Mr. Lee’s approval rating plunged to 15 percent?

No doubt the Korean reaction is irrational — though perhaps not so different from Americans’ own periodic import-related panic attacks, from the reaction to lead paint in Chinese toys to the Chilean grape scare of 1989, which caused U.S. officials to impound 2 million crates of fruit over wildly exaggerated fears of terrorist cyanide poisoning. No longer plagued by mass poverty and disease like its communist neighbor to the north, South Korea can afford exquisite sensitivity to remote health risks. In that sense, the booming, democratic South has earned the right to panic once in a while, just as Americans do.

But in South Korea, the health fears are compounded by nationalism. Mr. Lee, elected on a promise to mend fences with Washington, failed to anticipate that some of his people would see lifting the ban not as a sensible policy gesture but as a form of tribute to a foreign power with a troop presence that still gives it great influence over the country’s fate.

And Korean nationalism is compounded by Korean protectionism. A U.S.-South Korea trade agreement, signed last year, has enemies in both countries; its Korean foes will undoubtedly try to exploit Mr. Lee’s predicament to shoot down the agreement. The road to victory for Korean protectionists, though, leads through the Democratic-controlled U.S. Congress, which has refused to consider the deal until Korea lifts the ban. Even a partial backtracking now by Mr. Lee could doom the pact on the Hill.

The Bush administration must do everything it can to rescue the agreement, which would slash tariffs in both countries. American trade negotiators, who are meeting with their South Korean counterparts this weekend, must help Mr. Lee find a way to reformulate his decision to lift the beef ban — without actually reinstating the ban in any meaningful form. The Koreans are seeking to have American exporters voluntarily ensure that Korea-bound meat comes only from cows no older than 30 months. Five leading U.S. beef exporters have said they would temporarily add labels disclosing the age of the animals from which their product comes.

Once the beef issue is resolved, Congress will no longer have any good excuse to reject the trade deal. The only remaining objection would be the charge, voiced mainly by the United Auto Workers and a single automaker, Ford, that the pact does not sufficiently open the Korean car market. The Democratic leadership has expressed sympathy for this claim, as has the party’s presumptive presidential nominee, Sen. Barack Obama (Ill.). The vast majority of American industries, however, have analyzed the deal and declared it a win-win. In a year of seemingly rising anti-globalization sentiment, the path of least resistance for Democrats might be to let the deal die and blame South Korea. But Democrats should take their cues instead from Mr. Lee, who is trying to do the right thing for his country despite furious resistance. If he can take the heat, they can, too.

Report on U.N. Program Assails Whistle-Blower. {but does not repudiate him! - at the UN it Was Inner City Press that Kept an eye on the UNDP handling of this case - the UN can indeed not be allowed to be misused in all these ways that the case brought out. This even if personal matters skewed some of the presentation - but the UN was still proven as a conduit of illegal and illogical transfer of funds to the North Koreans - we wrote about this also when the case broke. At the time we also asked questions about exchange rates for untradeable currencies and how the UN was being bilked by Pyongyang.}

By Colum Lynch
Washington Post Staff Writer
Sunday, June 8, 2008; on important page A-18.
UNITED NATIONS — A U.N. official showed up at the U.S. mission to the United Nations in 2006 with an alarming story: The U.N. Development Program office he ran in North Korea had stashed thousands of dollars in counterfeit U.S. cash in a safe, diverted tens of millions more into the coffers of North Korean leader Kim Jong Il and possibly supported North Korea’s weapons programs.

For the next year and half, Artjon “Tony” Shkurtaj, an Albanian national who served as the UNDP’s operations manager in Pyongyang, guided U.S. officials on a tour of U.N. malfeasance in North Korea, furnishing internal U.N. documents and an insiders’ analysis of how the global body violated its rules and helped North Korea obtain hard currency and sensitive high-tech equipment.

His claims triggered investigations by U.S. officials, the United Nations and the U.S. Congress, and led to Shkurtaj’s designation as a whistle-blower by the United Nations’ ethics chief. Mark D. Wallace, the U.S. diplomat briefed by Shkurtaj, accused the UNDP of complicity in a scheme to divert millions of dollars worth of aid for the poor to Kim’s personal treasure chest.

Some of Shkurtaj’s assertions have since been substantiated. But some of the most serious allegations — that the UNDP knowingly channeled tens of million of dollars in funds to North Korea or that senior UNDP officials sought to cover up potentially illicit payments — have been repudiated by congressional and U.N. investigators, who have found no evidence of significant diversion of U.N. funds.

A panel appointed by the UNDP to probe the case issued a report last week attacking Shkurtaj’s credibility and saying he provided U.S. officials with documents that were exaggerated, misleading or false.

The report confirms some American concerns, including evidence that the UNDP imported millions of dollars worth of computers, GPS systems and other equipment into North Korea that were on U.S. “dual-use” control lists and anti-terrorism lists. Most of that equipment was left behind after the UNDP ended its program in March 2007.

But the report also asserts that the United States repeatedly made allegations against the UNDP that were either inflated or unsubstantiated, including a claim that North Korea used UNDP funds to buy residences in Britain, Canada and France. The North Koreans told congressional investigators that they had used a U.N.-related account they controlled to conceal their own overseas investments.

U.S. officials say the UNDP’s reluctance to detail the size of its programs forced them to look to Shkurtaj and other UNDP informants.

“The report reveals that UNDP made significant and previously undisclosed direct payments to Kim Jong Il’s regime and numerous sensitive ‘dual use’ items that remain in North Korea in violation of U.S. law,” said Wallace, who stepped down in April. “Responsible governments should ensure that UNDP returns to helping the world’s needy rather than inappropriate payments and unlawful technology transfers.”

As the UNDP’s operations manager in Pyongyang from March 2005 to May 2006, Shkurtaj raised concerns that the UNDP was violating its rules by paying for most transactions in foreign currency, hiring only government-selected workers and failing to demand access to UNDP bank accounts controlled by North Korea, the report said. “Shkurtaj was shining a spotlight on serious issues,” it stated.

Shkurtaj, a U.N. consultant, was rewarded with a full-time job offer. But it was withdrawn on a technicality. He returned to New York, where he was let go after serving a three-month contract.

U.N. ethics chief Robert Benson concluded in August there was a prima facie case that the UNDP had retaliated against Shkurtaj for shedding light on the UNDP’s practices in North Korea. But the UNDP refused to let Benson investigate and, instead, appointed an external panel to examine Shkurtaj’s charges.

The U.N. panel, headed by former Hungarian prime minister Miklós Németh, rejected Benson’s view, concluding that the UNDP made a reasonable effort to address Shkurtaj’s concerns. It found that Shkurtaj’s criticisms grew after being passed over for the job and that he then began manufacturing evidence that he was a whistle-blower. “Shkurtaj’s claims of retaliation are without merit,” the panel stated.

Shkurtaj declined to discuss the report’s findings, saying he would pursue his case with the U.N. ethics office. But he suggested that the UNDP would never have admitted its failings in North Korea, ended his U.N. career or attacked his reputation if he had not blown the whistle. “If I would not have spoken out, would any of this have ever happened?” he asked in an interview.

Shkurtaj’s supporters challenged the panel’s credibility, which was selected by the UNDP’s executive director, Kemal Dervis, and which included a member of a UNDP advisory board. “If you are the defendant you can’t be the judge and jury,” said Beatrice Edwards of the Government Accountability Project, which advises Shkurtaj.

The Németh panel contend that Shkurtaj fabricated at least two e-mails he had given the Americans showing he had repeatedly alerted senior UNDP officials about the presence of counterfeit U.S. dollars in a U.N. safe.

The U.N. obtained $3,500 in fake currency in 1996 from an Egyptian consultant who said a North Korean bank gave him the bills when he cashed his U.N. paycheck. Shkurtaj, the panel said, ignored an Aug. 10, 2006, e-mail request from UNDP headquarters in New York to look into the matter. { ??? }

Shkurtaj purportedly replied by e-mail the next day, asking what “procedures to follow for the money in the safe.” The panel said it had “serious reservations” about the authenticity of Shkurtaj’s e-mail, which could not be recovered in UNDP’s computer hard drives. The panel did recover another e-mail Shkurtaj wrote two days later saying he had not yet responded to the request.

UNDP officials have suggested that other U.S. allegations were based on forged documents. In June 2007, the United States provided UNDP officials with copies of spreadsheets outlining some of the more than $2.7 million alleged payments by UNDP to Zang Lok, a Macau-based trading company linked to a North Korean firm that finances ballistic missile sales. UNDP officials said they could not find a single match for the dates, costs or companies listed on the documents furnished by the United States. Their own records cited about $52,000 in payments to the firm.

The documents were either “doctored” by someone or misunderstood by the Americans, the UNDP told Congress in January. Németh confirmed UNDP’s figures, saying “there is no indication that UNDP” knew anything about Zang Lok’s relationship to North Korea.

—————-

Report on UNDP in North Korea Raises More Questions Than It Answers

Byline: Matthew Russell Lee of Inner City Press at the UN: News Analysis

UNITED NATIONS, June 2, 2008  – As the UN Development Program prepared put its gloss on a report by Hungarian prime minister Miklos Nemeth, in a hastily called press conference by UNDP Administrator Kemal Dervis, questions arose about the irregularities that the report confirms, in places begrudgingly. As so often happens at the UN, these confirmations are buried deep in the report. A wire service emphasized that the report “concluded that [Tony] Shkurtaj’s claims of retaliation are without merit. As a contract employee he could not have been fired, it was just that his contract was not renewed, it said.”

But UNDP formally selected and notified Shkurtaj of his selection and hiring for a full-time UNDP staff position as UNDP’s North Korea operation manager, out of a total of 174 applications and a finalist list of 29 applicants. (Click here for Inner City Press’ interview with Shkurtaj at the time.) Then UNDP subsequently retracted that offer from Shkurtaj.  This fits any credible definition of retaliation. Significantly, despite UN Ethics Officer Robert Benson’s plea to Dervis to allow his office, the UN specialist in whistleblower protection, to investigate the case, UNDP said no. Then UNDP said that this panel, which also included former World Bank official Chander Vasudev of India and former U.S. and U.N. official Mary Ann Wyrsch, would clear the air. But consider these questions about UNDP’s operations:

The Panel conducted “[a] review of documentation related to the Selected Projects budgets” and concluded that “[f]or 77 transactions (74%) the available supporting documentation was insufficient to determine whether the ultimate beneficiary is consistent with the payee name indicated in the financial system (pg 158).

“38% of disbursements made by UNDP-DPRK” were to DPRK “government agencies” which constituted 11 of the top 20 of all payees and totaled $9.13 million (pg 100-101). This analysis does not even include “disbursements made on behalf of UNDP-North Korea by UNDP country offices and other UN agencies” which totaled in the range of $33.3 million — $48.5 million (pg 118).  If at the same percentage payment rate to the DPRK government, then an additional $1 2.65 million to $18.43 million was paid directly to the DPRK government as part of the UNDP DPRK program.

The Panel’s review of the most sensitive items - those the Panel classifies as Level I and II — exported by UNDP to North Korea focused on 151 pieces of equipment and found that 95 items were “classified as being on the Commerce Control List…. [and] would have required a licensee from the U.S. Commerce Department for export or re-export to the DPRK”? (pg. 210)  The Panel found many such items were “controlled by the U.S. for national security and anti-terrorism reasons…. and were of heightened concern” (pg. 213).

“At the suspension of the UNDP program in the DPRK in March of 2007, the UNPD transferred a large amount of equipment in closed projects to agencies in the DPRK government…. [and] to the extent that this equipment included U.S.-origin items, the UNDP’s retransfer to the DPRK government of U.S.-origin items subject to U.S. license requirements would likely be considered by the U.S. to contravene its export policies prevailing at the time”  (pg. 215-216).

            Assistant Secretary General for Legal Affairs Larry Johnson reportedly opined to UNDP that UNDP required a “retransfer authorization” from the U.S. to transfer the equipment to  the DPRK or other third parties and that UNDP did not obtain any such “retransfer authorization” prior to transferring these items to the DPRK government (pg. 220). But what did the UN’s Office of Legal Affairs, of which Larry Johnson is the Deputy, do about this?

The Panel concluded “that in the course of his duties and areas of oversight, Shkurtaj in fact reported conduct and facts about UNDP operations in the DPRK that required resolution and may well have been in violation of UNDP policies as well as applicable agreements with the DPRK” (pg. 312).

The Panel noted  a “management lapse” in UNDP’s handling of the counterfeit currency (pg. 269).  The Panel “noted discrepancies” in the accounts that UNDP Comptroller Darshak Shah gave to the Panel regarding the counterfeit currency issue (pg. 267)  What action will be taken against Mr. Shah for his inconsistent statements to the Panel?

Footnote: As Inner City Press has previously reported, well-placed sources said Friday that UNDP long-prepared whitewash of its retaliation against the exposure of irregularities in its North Korea programs was to be unfurled Monday and that, not surprisingly, the whistleblower is not protected. But as noted above, even the Kemal Dervis-selected panelists admitted systemic breakdown of safeguards within UNDP. On Sunday night, the UN te-mailed to the press that Dervis would brief, or brag, at 11 a.m. Monday (Inner City Press’ UN bureau chief is in Africa, click here for the next of many articles.) The UN Ethics Office, which backed down or was called off this case once already, now has another chance, on this, the Koumoin / Cote d’Ivoire case, and the Somalia / KPMG cases, along others. Watch this site.

We less sure of this last answer, as several journalists have been asked to get letters from their country’s mission to the UN

McCain Breaks with Bush Over North Korea.
By Glenn Kessler, The Washington Post, May 27, 2008

Sen. John McCain broke today with President Bush’s new policy on North Korea, co-authoring an opinion article with Sen. Joe Lieberman (I-Conn.) in which he called for a return to Bush’s original demand of a complete, verifiable, irreversible disarmament of North Korea’s nuclear programs.

With the prodding of secretary of State Condoleezza Rice, Bush — who once labeled North Korea part of an “axis of evil” — has greatly softened his position on North Korea in the past year in an effort to convince Pyongyang to give up its nuclear weapons. But the shifts have greatly angered conservatives in the Republican Party. McCain’s new stance, which is outlined in an opinion article in Tuesday’s editions of the Asian Wall Street Journal, calls for a return to sanctions and other levers to prod North Korea.

The administration has argued that the diplomatic engagement — led by Assistant Secretary of State Christopher R. Hill — has convinced North Korea to begin dismantling its facilities and turn over 18,000 documents on its reactor at Yongbyon. But conservatives say those achievements have come only after large concessions by Bush, including returning millions of dollars tainted by illicit activities, and that a tougher approach is still needed.

The Bush administration has also relented in its demand for a full accounting of North Korea’s assistance to a reactor in Syria and its suspected experimentation of uranium enrichment, keeping the focus on seeking the return of weapons-grade plutonium.

“We must use the leverage available from the U.N. Security Council resolution passed after Pyongyang’s 2006 nuclear test to ensure the full and complete declaration, disablement and irreversible dismantlement of its nuclear facilities, in a verifiable manner, which we agreed to with the other members of the six-party talks.” McCain and Lieberman write. The Bush administration essentially abandoned enforcement of the U.N. Resolution when early in 2007 it decided to negotiate an end to the impasse.

The article also suggests that the Bush administration has abandoned the traditional alliance with Japan in pursuit of a deal. “We must never squander the trust of our allies and the respect for our highest office by promising that the president will embark on an open-ended, unconditional personal negotiation with a dictator responsible for running an international criminal enterprise, a cover nuclear weapons program and a massive system of gulags,” the two senators said.

The language concerning North Korea in the article — which overall sketches out a vision for engagement with Asia — is remarkably similar to President Bush’s first-term rhetoric, which the White House has largely dropped in recent months.

What is the UNSG’s Mr. Ban Ki-moon, and the new Korean government’s position in these matters? It would be nice if a Journalist accredited to the UN would ask the Secretary General.

Fukuda pledges full support for planned ASEAN unified market.

By REIJI YOSHIDA, The Japan Times onlline, Staff writer, Friday, May 23, 2008.

Echoing his late father’s message more than three decades ago, Prime Minister Yasuo Fukuda said Thursday that Japan will seek closer ties with Southeast Asian countries by supporting the planned creation of a single integrated market in the region.

In his speech to a symposium in Tokyo, Fukuda reconfirmed Japan’s support for the establishment of an economic community by the Association of Southeast Asian Nations by 2015, while noting Japan’s alliance with the United States will continue to provide security in the Asia-Pacific region.

Fukuda’s father, the late Prime Minister Takeo Fukuda, is best remembered for his Fukuda Doctrine of 1977, which declared to Southeast Asian countries that Japan would build closer ties with the region and never again become a military aggressor.

“My first promise to you is that Japan will emphatically support ASEAN’s efforts to realize a community,” Fukuda told the “The Future of Asia” symposium, which was attended by several leaders from Asian nations, including Thailand, Malaysia, Laos and Indonesia. “I am determined to cooperate with the efforts of ASEAN, which is aiming to establish the ASEAN Community by 2015,” he said.

Fukuda meanwhile argued that the security situation in Asia remains unstable, singling out North Korea as one example.

The Japan-U.S. military alliance thus helps stabilize the region and “serve as the cornerstone for Asian prosperity,” he argued. “The Japan-U.S. alliance is now much more than a means for ensuring the security of Japan; rather, it also serves as an instrument for the stability of Asia and the Pacific as a whole.”

The 1977 Fukuda Doctrine was warmly welcomed and is believed to have favorably altered the sentiment of ASEAN countries toward Japan.

At that time, memories of Japan’s wartime aggression were still fresh in the region, which saw Japan’s postwar rise into an economic powerhouse as a cause for concern.

Fukuda also pledged Thursday make Japan a “peace-fostering nation.”

He cited Japan’s Indian Ocean refueling support for U.S.-led antiterrorism operations in Afghanistan, the fight against terrorism and pirates in the Strait of Malacca, as well as Japan’s contributions to regional efforts to cope with natural disasters and the spread of avian influenza.